With the economy changing rapidly due to the COVID-19 pandemic, many small businesses are on the verge of collapse while large businesses run out of funding. While some companies and market niches have continued to perform as a result, most companies have taken a hit. However, like any other difficult time, you should plan to continue your business with new and better plans. With that said, consider the following when creating your next business plan for the fiscal year.
It is important to base your business plan on this year’s master plan. As such, you may be doing more “save as” or reiterations of strategic efforts than in previous exercises. While you are working on the growth change, your business activities may remain the same. However, you shouldn’t adjust your financial goals in the coming year without considering the prevailing business environment.
Therefore, when creating your weekly, monthly, quarterly, or annual business plan, consider the following basic elements:
Is your niche growing, advancing, shrinking or becoming obsolete? The answer to this question can guide you if you need to reinvent or continue your business model.
Who are your target customers for the next fiscal year? Where do they spend time online?
Are target customers spending more on your products or alternative products than you can but don’t promote? Do you need to increase online and social media marketing?
Do staffing and resource plans match your sales and income? Do you have a dedicated budget for improving your website?
What is the nature of your sales? Are they one-off offers or recurring customers? If these are one-off agreements, perhaps consider contract employees rather than full-time employees.
Consider changes in customer behavior
Whatever your business model, you need to base your 2021 business foundation on who you think your customers will be. While they might stay the same in some business models, other businesses will need to reshape to attract new customers. Predicting customer behavior is one of the reasons why most B2B companies opt for an account-based marketing strategy. This strategy focuses on selling products to existing customers rather than marketing to a general audience.
Changes in customer behavior will determine the trajectory of your business account, whether it is up or down. It also influences the cross-selling potential, the nature of competition, etc. For entrepreneurs who run B2C businesses, your business plan should focus on specific segments. For example, local businesses should focus more on customer referral and loyalty programs.
Consider changes in work habits
The pandemic has dramatically changed the way people work, with some of these changes potentially occurring well beyond the pandemic. The virus eliminated some tasks and completely reorganized the working environment. Significant changes include a shift from routine work to creative knowledge processes, remote working models replacing static physical offices, and creating workspaces that meet the new guidelines. Here are some crucial changes to consider when creating your business plan.
Check your financial model
The most enthusiastic companies are on hold until the government finally opens the markets. However, this might never happen, as the resumption of normal activities takes place in a fluid state. There may not be a specific deadline for businesses to resume operations as before. Therefore, when creating your business plan, include both short term and long term forecasts.
You should also frequently review your long-term financial progress. Most companies have constantly assessed and revised fixed and variable costs during the pandemic due to difficult economic conditions. Likewise, when planning the next fiscal year, fix your costs on business practices that you firmly believe in. Use partnerships and innovative options in variable cost areas as you rebuild the company’s bottom line.
Strategic planning and revenue forecasting are difficult disciplines for businesses, especially in times of uncertainty. The ongoing pandemic has made it impossible to predict the future business environment and plan accordingly. Therefore, when revisiting your business plan, step out of your comfort zone and consider the current business environment.
Mike Gingerich is president of Digital Hill Multimedia (www.DigitalHill.com), a web design and marketing agency. He is also co-founder of TabSite.com, a leader in Facebook page applications for businesses. Listen to his social media and web podcast, Halftime Mike, available on iTunes.